Lifetime mortgages are a type of equity release plan, secured against your current home. There are different types of lifetime mortgages, and each comes with its own benefits and pitfalls. Generally, the eligibility criteria for all types of lifetime mortgages state that you should be at least 55 years old, and the value of your property shouldn’t be lower than £70,000.
The main feature of a Flexible Lifetime Mortgage is that it provides you with the flexibility to make repayments without having to worry about Early Repayment Charges (ERC). You can choose to make no repayments or up to 40% of the balance each year (this varies with each lender). The full remainder of the loan is then repaid when you move into care or pass away.
Here are the key features of Flexible Lifetime Mortgage:
Check the list to see if you are eligible to apply for a Flexible Lifetime Mortgage.
In addition to the eligibility conditions, keep in mind the following conditions as well:
The amount you can borrow is limited and is set by the lender. You’ll be given an amount you can borrow up to, expressed as a % of your properties value. This is known as the LTV (loan-to-value) and is typically 25% – 50% of the value of your home.
To conclude, a Flexible Lifetime Mortgage allows you to make regular repayments whenever you have the resources to repay your mortgage. You are not bound by any kind of repayment plan like other types of lifetime mortgages.
For further information, consult a financial advisor to see if Flexible Lifetime Mortgage really suits your needs and aligns with your financial stability.
1.ClearKey is an independent marketing website which only acts as an introducer to companies who offer financial advice.
2.Our partners are authorised and regulated by the Financial Conduct Authority. ClearKey.co.uk are not authorised to give any advice and we are not liable for any financial advice provided by or obtained through a third party.
3. life insurance products attract terms and conditions. Price information contained within this website are for illustration purposes only. You will receive a full policy document upon application which will set out the terms, conditions and limitations of cover provided under the plan.
4. Your home may be at risk if you do not keep up repayments. Think carefully about securing debt against your home. When consolidating existing borrowing be aware that extending the term could increase the amount repaid.